Taiwan’s First Stablecoin Could Launch in 2026 Under New Law

The projected launch window for Taiwan’s inaugural stablecoin is not arbitrary but is directly tied to the legislative calendar. According to FSC Chair Peng Jin-lon, the critical first step is the passage of the proposed Virtual Assets Service Act in the country’s next legislative session. This act is designed to create a comprehensive regulatory framework for digital assets, a sector that has largely operated in a gray area. Only with this legal foundation in place can the process for authorizing a stablecoin proceed.

Following the bill’s enactment, regulators have mandated a six-month buffer period before the law takes full effect. This period is crucial for establishing detailed implementation rules, licensing procedures for issuers, and compliance standards. Therefore, the H2 2026 target represents a realistic forecast that accounts for both political and administrative processes. This structured timeline underscores the authorities’ priority on establishing robust oversight before allowing a new financial instrument tied to the national currency to enter circulation.

The planned stablecoin’s design offers insight into its potential role. It is proposed to be pegged to either the New Taiwan Dollar (TWD) or the US Dollar (USD). A TWD-pegged stablecoin would represent a direct digitization of the local currency, potentially streamlining domestic digital payments and settlements. In contrast, a USD-pegged version would align Taiwan with the dominant currency in global trade and cryptocurrency markets, possibly enhancing its utility for cross-border transactions and international crypto trading pairs.

This move by the Financial Supervisory Commission is a strategic response to the global proliferation of stablecoins like Tether (USDT) and USD Coin (USDC), which are widely used but operate outside Taiwan’s direct regulatory purview. By fostering a homegrown, regulated alternative, Taiwan aims to capture the benefits of blockchain-based efficiency and innovation while mitigating risks related to money laundering, consumer protection, and financial stability. It positions the island to participate more actively in the digital asset economy on its own terms.

The entire initiative hinges on the successful legislation of the Virtual Assets Service Act. This act is expected to define key terms, classify different types of digital assets, and set capital, governance, and operational requirements for service providers, including future stablecoin issuers. Its passage would mark a significant milestone, transitioning digital asset oversight from advisory guidelines to enforceable law and providing the clarity that institutional players and investors have sought.

For the local cryptocurrency industry, the announcement provides a much-needed regulatory roadmap. While the 2026 timeline may seem distant to some, it establishes certainty. Companies can now plan their business strategies around a known legislative schedule. The FSC’s clear communication, as reported by Focus Taiwan, aims to balance innovation with prudence, ensuring that Taiwan’s foray into stablecoins is built on a solid legal foundation rather than speculative haste.